2020 was an unpredictable year. We saw markets crash and markets recover. Never before has the value of a financial advisor been more apparent.

When faced with volatile financial markets, experience comes into play. Having a financial advisor on your side helps you to navigate the ups and the downs with experience and expert advice.

So how can a Financial Advisor help you in 2021?

A financial planner can assist with some core strategies to help you make the most of your finances in 2021.

  1. Asset Allocation

    A financial advisor will assist you in building your investment portfolio with a balanced asset allocation.

    When it comes to investing, diversification is paramount to ensuring a balanced portfolio over a variety of assets. A good advisor will work with you through your life goals and coordinate your investment strategy and portfolio to match your goals and risk profile. Your risk profile is dependent on your personal situation, goals and stage of life.

    This is a key factor in balancing your portfolio to meet your objectives.

  2. Behavioural Coaching

    The benefit of professional guidance cannot be underestimated. This was clearly evident throughout 2020. Investors raced to cash out of the stock market when things went downhill fast. Yet, if those investors had waited out the storm and held tight, they would have seen the rebound in stock prices within just a number of months. Investors lost tens of thousands in a matter of days. The immediate instinct was to cash out. Emotions set in. The human behavioural response was to cut and run.

    Now replace this scenario with that of having a financial advisor. Having a balanced oversight of a financial advisor helps to put the emotions aside. They maintain focus on your investments. They know not to cash out when stocks hit an all-time low. Buy low, sell high. They keep you on track and help to mitigate the temptation to make a fast decision based on fear. They bring clarity and experience.

  3. Expertise

    A financial advisor will not just set up your investments and move on. It is a continuous journey where goals and objectives are continuously discussed and renegotiated.

    Changes to your investments are made dependent on your circumstances and stage of life. By partnering with a financial advisor, you will feel more empowered in your investment decisions with more control over your short and long-term financial goals.

  4. Tax-Effective Investing

    Implementing tax-efficient strategies is one of the most important roles a financial planner will play. They can not only assist with tax minimisation strategies but also ensure there are no hidden tax surprises at tax time.

If streamlining your finances is in your 2021 plan, consider discussing your options with a financial advisor. It could be one of the best decisions you’ll ever make.